Apple has weathered a rather rough year of bad press, much of it focused on Apple’s 30 percent cut of all paid app sales and in-app purchases and the many rules it imposes on developers before it grants entry into the App Store.Īpple has faced pressure from rivals and regulators over the App Store’s 30 percent cut and other restrictions This new program is sure to please more niche app makers, indie game developers, and other members of the iOS ecosystem who’ve felt the scale and success of the App Store hasn’t translated to tangible developer benefits in recent years. The company’s most recent change of this magnitude occurred in late 2016, when it first began allowing subscription services to keep an extra 15 percent of revenue if a subscriber stays signed up through an iOS app for longer than 12 months.Īpple has also reduced its App Store cut or exempted certain services altogether, as it did for sign ups to Amazon Prime Video and more recently for in-app Prime Video rentals and purchases, but the company often only cuts such deals behind closed doors and has not typically extended those benefits to developers it does not negotiate directly with. This isn’t the first time Apple has reduced commission rates for certain developers. Our new program carries that progress forward - helping developers fund their small businesses, take risks on new ideas, expand their teams, and continue to make apps that enrich people’s lives. The App Store has been an engine of economic growth like none other, creating millions of new jobs and a pathway to entrepreneurship accessible to anyone with a great idea. We’re launching this program to help small business owners write the next chapter of creativity and prosperity on the App Store, and to build the kind of quality apps our customers love. Small businesses are the backbone of our global economy and the beating heart of innovation and opportunity in communities around the world. If a developer falls back below the $1 million threshold in a future calendar year, Apple says they can re-qualify for the program and its reduced commission rate.Īpple CEO Tim Cook described the move as a way to support small businesses, which he describes in a statement as “the backbone of the global economy and the beating heart of innovation”: For those app makers that exceed the $1 million threshold at any point in 2021, they will automatically be removed from the program and subject to the standard 30 percent cut. New developers can also qualify right away.
The company says it will look at developer proceeds for the year of 2020 to determine eligibility starting in January. Apple did not elaborate on why it’s choosing not to automatically enroll developers into the program, but it’s possible requiring that developers enroll may reduce the potential for fraud or other abuses that could arise if Apple simply auto-enrolled everyone below the threshold.Īpple did spell out some of the program’s rules today. Developers will be asked to apply for the program, and Apple says it will be releasing more information about that process and other eligibility requirements and deadlines in December. The new small business program goes into effect starting January 1st, 2021. According to analytics company Sensor Tower, an estimated 98 percent of developers would be eligible for the 15 percent cut, but those developers generated just 5 percent of the App Store’s total revenue last year. The App Store, which generated an estimated $50 billion in revenue in 2019 according to CNBC, is one of Apple’s most pivotal businesses beyond the iPhone and represents a pillar of the digital services strategy CEO Tim Cook has touted as the future of the company’s business.
Apple will let developers who earn less than $1 million keep 15 percent more revenue